May 9 2011 insight to last week

Last weeks commodities sell off, erased almost $100 billion of market value.  Many of the small speculators were driven out of the market.  Just as Goldman Sachs predicted the sell off, they are now predicting a recovery in the commodities market.

My idea is to start looking at buying back in to the commodities, while maintaining a very careful risk management program.

US Dollar and Gold

It seems that the weak US dollar is having the most influence on gold at the moment. The overall market is getting more nervous now that the US is experiencing sovereign-debt concerns. In addition to Europe and the Middle East problems, the demand for gold is increasing as it is considered a safe haven product. The North American markets are closed today for Good Friday; though is Asian silver and gold continued its rise for its 3rd weekly gain.

This Mornings Markets

Once again, we woke up this morning to see gold rising to a record in New York and London as concern about faster inflation and a weakening U.S. dollar.  Historically, when the U.S. Dollar falls, gold rises as an alternative investment.  Silver also touched a 31-year high.

On our home currency front, the Canadian dollar has taken a little breather after a strong few weeks.  There is no data to report out of Canada today, so we do not expect any major volatility, unless we get surprises from the US Monetary policy.

A Quick Update

Another week, another record high for gold! This morning gold jumped to an all time high based on the concern of inflation and ever weakening U.S. Dollar. The commodities market opened up this morning to a 2 year high.

Our Canadian Dollar which its strength is many times linked to increasing commodity prices is at a 3.5 year high.  Our jobs report came in slightly weak, but with all the fundamentals out of the way and the commodities market rising, the Canadian Dollar looks robust.

Oil, Unemployment and the Canadian Dollar

It looks like we will be paying more for gas at the pump for a while. Oil rose to almost a 2 ½ year high this morning as economic data from China shows hope of growing demand. China is the world’s biggest energy user. Fighting in Libya has continued and the risk is always that it will spread to other Middle East countries which produce the oil. May futures are now trading at almost $107.50USD/barrel.

 

Here at home in Canada, it seems the consensus is that the unemployment rate will likely hold at 8.9%. Canada’s employment report will be released at the end of next week. This morning, the Canadian dollar is gaining across the currency board.

Welcome

Welcome to the official Barret Capital Management Inc. blog. Barret Capital is an Investment Dealer that specializes in futures and options on metals, energies and all other Exchange-traded commodities, located in Toronto Ontario. This blog will discuss all aspects of investing in commodities, the current market and make predictions on the future market.

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